The Drug Enforcement Administration (DEA) recently released a proposed rule for hemp and CBD, but while the agency stated that the regulations would simply bring their procedures into line with federal law, some industry players suspect that they are actually setting the stage for cracking down against the new legal market. The DEA standard also eliminates CBD-based drugs approved by the Food and Drug Administration (FDA) from CSA Schedule V. The memorandum reflects the federal government's recognition that safety assessments must take into account evolving state and local marijuana laws, while reflecting the place of marijuana as a Schedule I drug. Let's start by looking at the definition of marijuana with an “H” (marijuana), which is in fact programmed.
This includes all parts of Cannabis Sativa L. plant, excluding non-viable seeds, stock and fiber, but including resins and the rest of the plant. CBD, of course, is present in the marijuana plant. If you get CBD from the marijuana plant, in fact, it would be controlled, because it comes from a controlled substance.
This is known as the “source rule”, the source of the material dictates its legality. But what if CBD and other non-psychoactive cannabinoids are derived from a legal source, such as the other 25 plant species that contain levels of cannabinoids or industrial hemp? A strong negative reaction can be expected from the hemp and CBD industries, as well as litigation against the DEA if its new standard is maintained. The FDA does not certify THC levels in CBD products, and studies show that the THC levels advertised on product labels may be inaccurate. Consequently, an applicant who uses CBD products risks testing positive.
Memorandum echoes FDA warnings about incorrect THC labeling. The memorandum also addresses people investing in marijuana businesses. It explains that an applicant's conscious decision to invest directly in stocks or companies that are specifically owned by marijuana producers and retailers could reflect questionable judgment and a lack of will to comply with laws. Consequently, such an investment could adversely affect an applicant's security-related award (although agencies should consider mitigating factors, such as the divestment of such activity).
On the other hand, investing in marijuana companies through a diversified publicly traded investment fund would not constitute a “direct” investment and would not be considered relevant in determining awards. Like FDA-approved CBD products and viable hemp seeds, entities no longer require DEA registration or import and export permits to handle hemp extracts that do not exceed the legal THC limit of 0.3%. However, just like importers of viable hemp seeds, importers and exporters of FDA-approved CBD products will no longer have to obtain import and export permits from the DEA. Months after the launch of Epidiolex, CBD has become its own unique regulatory challenge after breaking into the consumer market in recent years.
It is important to note that ignorance of federal marijuana law remains relevant, but not decisive, for safety-related judgments. Evaluators can ask applicants to sign certifications on these topics, and evaluators are encouraged to advise applicants to refrain from using marijuana in the future. In summary, it is clear that while marijuana remains illegal under federal law, safety assessments must take into account evolving state and local marijuana laws when determining awards. The DEA's new standard clarifies that all hemp derivatives or extracts that exceed 0.3% of delta-9 THC remain a Schedule I controlled substance.
The memorandum also addresses people investing in marijuana businesses and warns applicants about using CBD products due to inaccurate labeling.